Local Authority Pension Fund Forum

Local Authority Pension Fund Forum
Name	Local Authority Pension Fund Forum
Formation	2000
Type	Non-profit organisation
Headquarters	London, United Kingdom
Region served	United Kingdom
Membership	Local authority pension funds
Leader title	Chair

Local Authority Pension Fund Forum is a United Kingdom-based membership body of public pension investors formed to promote good corporate governance and responsible investment practices among companies and investors. It brings together local authority pension funds to collaborate on shareholder engagement, stewardship, and fiduciary responsibilities concerning pension assets held in public markets. The Forum has influenced corporate governance debates involving major corporations, regulatory bodies, and institutional investors across the UK and internationally.

History

The Forum was established in 2000 following discussions among senior officers from Local government pension scheme, local authorities including London Borough of Hackney, Greater Manchester Pension Fund, and other municipal investors seeking collective engagement on issues raised by companies such as Royal Dutch Shell, BP, and Barclays plc. Early initiatives saw collaboration with UK institutions like the Pensions Regulator and the Financial Reporting Council on codes of practice that echoed themes in reports such as the Turnbull Report and the Hampel Report. Through the 2000s the Forum engaged on controversies involving British Petroleum, RBS, and GlaxoSmithKline, coordinating voting guidance with partners including Friends Provident, Aviva Investors, and Legal & General Investment Management. Post-2010, the Forum expanded activity into climate-related engagement aligned with frameworks such as Task Force on Climate-related Financial Disclosures and worked alongside organisations like Principles for Responsible Investment and Institutional Investors Group on Climate Change.

Objectives and Activities

The Forum’s stated objectives include promoting effective corporate governance among companies such as Tesco, Marks & Spencer Group, Rolls-Royce Holdings, AstraZeneca, and Unilever plc; encouraging responsible investment practices among asset owners like London Pension Fund Authority and West Midlands Pension Fund; and advancing stewardship principles endorsed by the UK Stewardship Code. Activities encompass collaborative shareholder engagement, development of voting policies, publication of position papers on remuneration practices at firms like Smith & Nephew and InterContinental Hotels Group, and thematic initiatives on climate change and human rights concerning firms such as Rio Tinto Group and Glencore. The Forum issues voting recommendations at annual general meetings affecting directors at BP plc, HSBC Holdings plc, Barclays PLC, and other major issuers.

Governance and Membership

The Forum is governed by a board drawn from member funds including representatives from Greater Manchester Pension Fund, Kent County Council Pension Fund, Brent Pension Fund, Lothian Pension Fund, and Norfolk Pension Fund. Governance structures reflect best practice influenced by bodies like the Audit Commission and standards promoted by Institute of Chartered Accountants in England and Wales. Membership comprises UK local authority pension funds and associated officers from schemes administered by councils such as Southwark Council and Leeds City Council. The Forum liaises with service providers including Mercer (company), Aon plc, and Hermes Investment Management and coordinates with umbrella organisations such as Local Government Association and TUC on pension policy matters.

Advocacy and Engagement

Engagement strategy combines bilateral meetings with companies such as National Grid plc and BT Group and collaborative actions with investor coalitions including Ceres, ShareAction, and Climate Action 100+. The Forum has campaigned on issues ranging from executive remuneration at firms like WPP plc to board diversity at Johnson Matthey and BAE Systems. It has provided evidence to parliamentary inquiries by the House of Commons Committee of Public Accounts and engaged with regulators like the Prudential Regulation Authority and the Financial Conduct Authority on stewardship and disclosure. International engagement includes cooperation with counterparts in Ontario Teachers' Pension Plan and Australian funds such as AustralianSuper during cross-border campaigns targeting multinationals including GlaxoSmithKline and Shell plc.

Funding and Financial Overview

Funding is primarily subscription-based, sourced from member contributions by funds such as Cambridgeshire County Council Pension Fund and Oxfordshire Pension Fund. The Forum occasionally receives project-specific support from foundations and partners including Joseph Rowntree Charitable Trust and collaborates on funded research with academic centres like London School of Economics and University of Oxford. Financial oversight adheres to practices recommended by the Charity Commission for England and Wales where applicable and internal audit arrangements mirror procedures employed by public sector bodies including National Audit Office. Annual budget lines typically cover staffing, engagement costs, research, and convening activities with external providers such as FTSE Russell and Bloomberg L.P..

Criticism and Controversies

The Forum has faced criticism regarding perceived politicisation of investment decisions, with critics pointing to interventions on climate policy and human rights that intersect with public debate involving entities such as UK Department for Business and Trade and United Nations frameworks. Some asset managers and corporate executives, including figures from Barclays PLC and Tesco plc, have disputed collective voting recommendations as overstepping fiduciary duties, echoing debates raised by commentators from Institute of Directors and think tanks like the Adam Smith Institute. Questions have been raised about transparency and accountability relating to coordination among members, prompting scrutiny akin to inquiries by the Competition and Markets Authority and parliamentary scrutiny panels. The Forum has responded by publishing engagement reports and criteria, drawing on precedents set by UK Stewardship Code signatories and recommendations from the Law Commission.

Category:Organisations based in London